InterDigital Shares Popped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: InterDigital (Nasdaq: IDCC  ) popped 19% in intraday trading today on news reports that Google (Nasdaq: GOOG  ) is interested in bidding on InterDigital.

So what: Today's pop builds on a 28% pop yesterday, on news that InterDigital's board had initiated a "strategic review" that could result in a sale of the company, and a 17% pop on July 1, as investors reassessed the value of InterDigital's patent portfolio based on strong bids for Nortel's patent portfolio.

Now what: InterDigital's patent portfolio is rich in intellectual property in the hot wireless communications/mobile sector, a key strategic focus for Google. Google bid on Nortel's patent portfolio, but lost out to a consortium that included Apple (Nasdaq: AAPL  ) , Microsoft (Nasdaq: MSFT  ) , Research In Motion (Nasdaq: RIMM  ) , Sony (NYSE: SNE  ) , EMC (NYSE: EMC  ) , and Ericsson. The consortium paid a stunning $4.5 billion for Nortel's patents, about 60% more than InterDigital's $2.8 billion market cap at today's intraday price of $61.25.

Interested in more info on IDCC? Add it to your watchlist by clicking here.

Fool contributor Cindy Johnson owns shares of InterDigital. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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